@gabednar1962
Yes, my answer would change. For a Class-Action law suit the answer is - It depends on what the settlement was for. If the settlement was payment of punitive damages, then the proceeds are taxable. If it was payment of covered benefits previously denied, it would not be taxable if it is a qualified LTC plan. If it represented a return of premiums (as in the original question) it would not be taxable. Again, it depends on what the $6,000 payment was for.
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